U$$R & the Crem de la Krem-lin
In the wake of the Russian invasion of Ukraine, we've seen several stories of embargoes placed on Russia in the form of sanctions against Russian oligarchs. On March 16, the British crown dependency of the Isle of Man announced that it had deregistered 18 Russian aircraft. Eleven of those aircraft, which includes Alisher Usmanov’s $350 million Airbus private jet and five helicopters owned by Roman Abramovich are owned by sanctioned Russian billionaires.
According to Forbes at least 25 jets and nine helicopters were linked to 15 sanctioned Russian-born billionaires. All but five of the aircraft are registered in Aruba, Austria, Bermuda, the Cayman Islands, the Isle of Man, Luxembourg and the United Kingdom, all of which have implemented EU or U.K. sanctions. Many of these Caribbean islands have long since been havens and hang outs for Russian ultra-elites. Collectively, the 34 aircraft are worth at least $1.9 billion. The island of Bermuda has also suspended certificates of airworthiness for 740 “Russian operated aircraft”. This means that they are legally grounded and can no longer fly. One such sanctioned Russian billionaire in Bermuda is Viktor Rashnikov.
Viktor Rashnikov is a Russian billionaire businessman and the majority owner of Magnitogorsk Iron & Steel Works (MMK). Reported to have an estimated net worth of over $13 billion, he began his career with MMK in the company's repair shop as a mechanic and fitter in 1967. Very educated, in 1974, Rashnikov earned a bachelor's degree in metal forming process and later gained another degree in Organization of Production Administration, in 1994. He received his doctorate in Technical Sciences in 1998. In addition to writing many research papers and scientific reports, he has implemented numerous engineering solutions. In addition to owning the 10th largest yacht in the world, which was sanctioned, he also owns a Gulfstream jet in Bermuda. Another private jet in the crosshairs is the Dassault Falcon 7X linked to Alisher Usmanov.
The Uzbekistan born Russian businessman and oligarch has an estimated net worth of $19.5 billion and is among the world’s 100 wealthiest people. Usmanov made his wealth after the collapse of the Soviet Union, through metal and mining operations, and investments. He is the majority shareholder of Metalloinvest, a Russian industrial conglomerate. Usmanov was named in the Official Journal of the European Union, the publication of record of the EU, as a "pro-Kremlin oligarch with particularly close ties to Russian President Vladimir Putin one of Vladimir Putin’s favorite oligarchs."
The Falcon 7X is pure elegance, efficiency, and performance. The Falcon 7X is also the most technologically advanced business jet in service anywhere in the world today. The 7X would become the first business jet to use fighter jet technology with an elegant, whisper-quiet executive cabin. Also, the Falcon 7X is still the most advanced and still the business jet benchmark for the 21st century. This high, wide, handsomely proportioned executive suite features three spacious lounge areas, 28 large windows, and acoustics technology that limits noise for a restful, more productive travel experience. Designed for lengthy missions, the 7X is your home away from home, especially when equipped with options such as a second lavatory or an on-board shower to ensure you arrive refreshed and at your best.
Organized into three lounges, accommodating 12 to 16 passengers, the expansive interior of the Falcon 7X allows you to tailor your cabin to your exact needs. To further personalize your travel environment, a selection of elegant interiors is also available. Beyond the peaceful silence, abundant natural light and spectacular views, the 7X cabin offers a breakthrough environmental system. At an altitude of 41,000 ft, passengers enjoy a comfortable cabin pressure of 3,950 ft. Climate controls keep temperature constant, within one degree. Air is humidified and refreshed. This is a cabin that enhances your well-being throughout a long flight as well as your readiness for the long, challenging day that lies ahead upon arrival. The price of a Dassault Falcon 7X is between US $35 million and US $53 million for 2018 – 2022 models, for the last 5 years of production, according to Aircraft Bluebook. The price of a jet depends on the production year.
In the wake of EU sanctions, the German Federal government created a task force to track down oligarch funds in Germany. Several ministries and authorities are involved, from the Ministry of Economics and Finance, the financial supervisory authority BaFin, the Federal Criminal Police Office, customs and the Federal Intelligence Service (BND). Authorities of this task force have been looking for Usmanov's property and assets from that could be frozen and secured. Among those assets are luxury yachts and aircrafts. Usmanov has owned two luxury yachts named Dilbar, after his mother. In 2008 he took delivery of the first Dilbar (now Al Raya after selling to a Middle Eastern buyer) from Lürssen at a reported cost of $250 million. In 2019 it was the 38th largest motor yacht by length, measuring 110.0 m (361 ft). In 2015 Usmanov commissioned the second Dilbar, the current largest yacht in the world by gross tonnage (15,917 gt) and the 6th largest yacht by length measuring 156.0 m (512 ft). It is reported to have cost $800 million, employ 84 full-time crew members, and contain the largest indoor swimming pool installed on a superyacht at 180 cubic meters.
The legendary G650, the type owned by Viktor Rashnikov, is trusted around the world for record-breaking speed and range and has set the standard for performance in business aviation. With more than 470 aircraft in service and 120-plus world speed records, the G650 and G650ER are among the most trusted business jets in the world. The Gulfstream G650 is a large business jet produced by Gulfstream Aerospace and may be configured to carry from 11 to 18 passengers. The Gulfsteam G650 cabin is up to 20 percent quieter than the Global 6000. Capable of circumnavigating the globe with only a single stop. Gulfstream began the G650 program in 2005 and revealed it to the public in 2008. The G650 was formerly the company's largest and fastest business jet with a top speed of Mach 0.925, having been surpassed by the larger G700. The aircraft project was named the 2014 winner of the Collier Trophy, for having "strengthened business aviation through significant technological advancements in aircraft performance, cabin comfort, and safety. The 300th was delivered in April 2018, just over five years since introduction in December 2012. The 400th was delivered in December 2019, seven years after the type's introduction.
The cabin of the Gulfstream G650 is 53ft 7 in (16.33m) in length or 46ft 10in (14.27m) excluding baggage space. With a height of 6ft 3in (1.9m), there is room to move around comfortably. Depending on the internal configuration, there is room for up to 19 passengers, with sleeping room for up to 10 people. The cabin can be divided into 4 different living areas. It comes with a full kitchen, satellite phone, wireless network, and a variety of other entertainment features. There are 16 panoramic oval windows, ensuring great views and plenty of natural light in the cabin. The air circulation system reduces fatigue by providing 100% fresh air and a sound suppression system provides what Gulfstream claims is the quietest in aviation. There are 195 cubic ft of baggage space.
Usmanov apparently has his hands and influence as well as affluence in a host of hideaways. French authorities froze two helicopters belonging to the oligarch on the French Riviera. The French Ministry of Economy and Finance managed to freeze an Airbus EC-175 with the tail number M-DLBR and a Eurocopter EC-155 with the tail number M-DLBA in Le Castellet and in Monte Carlo, Monaco. M-DLBR is owned by Cayman Islands-based Crystal Sky Limited and M-DLBA is owned by Caymans-based Margaux Aviation Limited, according to the Isle of Man Aircraft Registry.
The EC175 Executive and VIP versions integrate a superior level of interior cabin creativity from Peder Eidsgaard of Pegasus Design, whose worldwide reputation results from his work on business jets and super yachts. These aircraft will be Eurocopter’s top-of-the-range products in their segments. The EC175 VIP is offered in three different styles, all accommodating from six to eight passengers. The first style is “avant-garde,” inspired by modern sport cars; another brings the French flair – contemporary and highly sophisticated – inspired by modern penthouse interiors; while the third is more classical, inspired by the grand villas of Europe. Features of the EC175 VIP include a unique cabin layout with two seating areas. The forward zone – which incorporates a domed roof that enhances the feeling of spaciousness overhead – provides a lounge atmosphere with facing club seating position for four passengers, while an aft sofa-style seat comfortably accommodates three passengers.
Options include electrochromatic windows, an in-flight entertainment system with audio and video interfaces, and wireless connectivity via satellite communications links. The EC175 helicopter has a spacious and comfortable cabin with plenty of room for passengers on board the aircraft. The cabin can accommodate 16 passengers and can be accessed through wide sliding doors mounted on both sides of the fuselage. The cabin has two large hatches facing upwards which provide access to the baggage compartment with a volume of 83 ft³ (2.35 m³).
In all versions, the EC175 Executive and VIP provide a jet-like smooth ride at all speeds and a climate-controlled cabin – even when the main rotor is stopped. It offers excellent range, performance and cruise speeds, while also meeting the most demanding operational safety standards. Featuring more window area than walls, the rotorcraft ensures panoramic views for all passengers, and it completes the upper end of Eurocopter’s helicopter product line for the business and private aviation sectors. The price of a general EC175 helicopter is around US $ 10 million, while the VIP version starts at $ 17.9 million.
The EC155 B features a completely redesigned cabin providing 30% more passenger space than previous Dauphin helicopter models, plus a 130% increase in baggage hold volume. Other major improvements include a five-blade Spheriflex composite main rotor combined with the familiar shrouded Fenestrontail rotor to reduce vibration levels significantly. The EC155 B is powered by two 635 kW TurbomecaArriel 2C1turboshaft engines mounted over the luggage hold, which feature a dual-channel Full Authority Digital Engine Control (FADEC) system. The EC155 B1 features uprated 697 kW. Arriel 2C2s. The helicopter can be fitted with an anti-icing system to enable the aircraft to operate in very cold climates. The all-glass cockpit is equipped with an 'Avionique Nouvelle' integrated digital flight control system featuring Eurocopter's Vehicle and Engine Management Display (VEMD), which utilizes active-matrix liquid crystal displays. The EC155 is also equipped with a four-axis digital autopilot, coupled to the engine FADECs for full-envelope protection, and is offered with a Health and Usage Monitoring System (HUMS). The Passenger Transport version can carry 12 passengers in comfort seats or 13 passengers in utility seats, along with 1 or 2 crew. The VIP or Corporate Transport version has a VIP lounge with working space accommodating up to 8 executives.
The price of an EC155 helicopter is around US $ 10 million. To date, more than 500 EC155 helicopters have been produced and operate in various operators throughout the world, including the Hong Kong Government, the German Federal Border Guard (BGS), the Petroleum Shell Development Company in Nigeria, Azerbaijan Airlines, Samsung in South Korea, the Royal Police Thailand and Heli Air Monaco / Monacair for VIP transportation of the Monaco royal family. VIP EC155 cabin is equipped with Cocoon Iso-Quiet interior developed by American Eurocopter and Heritage Aviation Ltd, both based in Grand Prairie Texas. The interior of the Advanced Iso-Quiet Cocoon has a multi-wall cocoon concept with an acoustic barrier that is embedded during the manufacturing of composite wall panels.
There are several types of sanctions: diplomatic, military, economic, sport sanctions, individual sanctions and sanctions on the environment. Economic sanctions are commercial and financial penalties applied by one or more countries against a targeted self-governing state, group, or individual. Economic sanctions are not necessarily imposed because of economic circumstances. They may also be imposed for a variety of political, military, and social issues. Deregistration makes an aircraft “stateless” and deprives it of a valid certificate of airworthiness, meaning it’s no longer insurable and can’t fly until it’s registered in a new country. The sanctions even prohibit the sale of spare parts for the sanctioned aircrafts in question.
According to Newsmax Magazine, about 20 Russian elites have lost more than $80 billion in wealth combined in recent weeks due to sanctions from the European Union and the U.S. along with the collapse of the Russian ruble and economy. The crew on Usmanov's yacht had been fired because Sarnia Yachts, the firm that employed the crew, was no longer able to pay salaries due to EU and U.S. sanctions. On March 30, Irish lessor AerCap had repossessed 22 of the 135 aircraft it had leased to Russian airlines, and 3 of the 14 engines being leased. It filed insurance claims amounting to $3.5 billion for the remaining aircraft, many of which were "now being flown illegally by their former airline customers". Singapore-based lessor BOC Aviation had 18 aircraft worth $935 million on lease to Russian companies; it repossessed from Hong Kong one Boeing 747-8F leased to AirBridge Cargo but two other freighters were flown back to Russia contrary to explicit instructions, despite their insurance coverage and airworthiness certificates having been revoked.
So detailed and far reaching are the sanctions that even airspace over some sanctioning countries have been restricted. On February 25, the UK announced the closure of its airspace to Russian airlines. On the 27th February, the EU and Canada closed their airspace to all Russian aircraft, including both commercial and private aircraft. Russia issued a reciprocal ban, forcing many airlines to reroute or cancel flights to Asian destinations. The US issued a similar ban on March 1st, called Operation KleptoCapture.
On March 11, 2022 President Joe Biden signed Executive Order 14068, "Prohibiting Certain Imports, Exports, and New Investment With Respect to Continued Russian Federation Aggression," an order of economic sanctions under the United States against several oligarchs. The order targeted two properties of Viktor Vekselberg worth an estimated $180 million: an Airbus A319-115 jet and the yacht Tango. The 65-year-old Jewish Ukranian and Russian citizen is a world-renowned art collector among other noted acclaims. Vekselberg is now one of the world’s 100 richest men, with a current net worth of $15.5 billion, according to the Bloomberg Billionaires Index. He has consolidated his businesses under the Renova Group umbrella, with oil, metals and telecommunications components. His art collection boasts of the Imperial Faberge eggs, designed for the czars as Easter gifts. As a patriotic gesture to Russia, he bought them at a reported cost of $100 million and repatriated them to Russia.
The Airbus A319-115 owned by Vekselberg is a short- to medium-range, narrow-body, commercial passenger twin-engine jet airliners manufactured by Airbus. The A319 carries 124 to 156 passengers and has a maximum range of 3,700 nautical miles (6,900 km; 4,300 mi). The A319 carries 124 to 156 passengers and has a maximum range of 3,700 nmi (6,900 km; 4,300 mi).
Estimates of the value of the Tango range from $90 million to $20 million. On April 4 2022, the yacht was seized by Civil Guard of Spain and U.S. federal agents in Mallorca. A United States Department of Justice press release states that the seizure of the Tango was by request of Task Force KleptoCapture, through the U.S. Deputy Attorney General Merrick Garland.
The US Federal Aviation Administration also downgraded Russia's safety rating, meaning that no new services to the US and no codeshares with US carriers are authorized. In May, the UK announced that Russian airlines would be prohibited from selling their landing slots at UK airports, valued at approximately £50 million pounds. Although the war in Ukraine rages on, sanctions have hit Russia very hard. On May 8th, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated individuals and entities critical to Russia’s ability to continue waging war against Ukraine. These include the board members of two of Russia’s most important banks (Sberbank and VTBR Banks), a Russian state-owned bank and 10 of its subsidiaries, a state-supported weapons manufacturer, and three of Russia’s state-controlled television stations that generate revenue for the state.
The OFAC also took action to cut off access to services that are used by the Russian Federation and Russian elites to evade sanctions. That same day, OFAC identified accounting, trust and corporate formation, and management consulting as categories of services that are subject to a prohibition on the export, reexport, sale, or supply, directly or indirectly, from the United States, or by a U.S. person, wherever located, to any person located in the Russian Federation, pursuant to Executive Order 14071. Even though it is too early to assess the damage that the global sanctions against Russia have caused, it can be thoroughly concluded that they have taken a toll on Russia's ability to wage such an unprovoked war against the country of Ukraine.